E.U. Agency in Limbo as Hidden Costs of ‘Brexit’ Continue to Mount


From the car industry to finance, that task is proving messier and more complicated than expected, with effects more far-reaching than anyone imagined — in this case with worrying implications for Britain’s vibrant and successful biotech and pharmaceuticals sector and Europe’s public health.

With the agency’s days in London almost certainly numbered, cities like Stockholm and Strasbourg, France,are scrambling to lure its team of experts, who license drugs and monitor their use for safety. But the uncertainty has left the agency’s executive director, Guido Rasi, “very worried” as experts start to quit and others are recruited away.

“The consequence, and the direct impact on the public health, is my main concern,” Mr. Rasi said, in a room overlooking London’s old docks. Among its tasks, the agency oversees a globalized supply chain for drugs in liaison with other international regulators.

“Imagine if we are late in reaction for some crisis, something going wrong, something unexpected, some quality issue,” he added. “If we are not in a position to intervene fast and efficiently,” he added, “that is a serious threat to public health.”

Though not critical yet, he said, the staff problems have grown since the referendum on Britain’s exit from the bloc, known as Brexit. Mr. Rasi has already lost half a dozen experts from the agency’s 890 staff members, a noticeable number after years when resignations were rare. While well-qualified experts are being courted with job offers, uncertainty is making it difficult to attract replacements.

Most worrisome is an internal assessment suggesting that relocating the agency might mean losing up to half its personnel. That would be a big setback. In two decades, the agency has authorized about 1,000 products for use across the 28-nation European Union plus Iceland, Liechtenstein and Norway.

With a full workload of applications in the pipeline, the organization is already close to the breaking point, Mr. Rasi said. If it loses more than 15 percent of its experts, he added, the agency will probably not be able to maintain current schedules for licensing new drugs and monitoring existing ones.

Some pharmaceutical companies are worried, too. Moving the agency would cause “tremendous disruption,” said Andrew Witty, the chief executive of Britain’s biggest drug maker, GlaxoSmithKline.

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“The consequence, and the direct impact on the public health, is my main concern,” the agency’s executive director, Guido Rasi, said. As many as half of the agency’s experts are thought likely to leave if relocation proceeds.

Credit
José Sarmento Matos for The New York Times

“This is a regulator who is keeping an eye on the health and safety of hundreds of millions of Europeans,” Mr. Witty told Bloomberg TV. “You don’t want them with their eye off the ball.”

Little of this impinged on the acrimonious campaign ahead of Britain’s vote on June 23 to quit the bloc, during which the agency’s future — or that of the European Banking Authority, which is also in London — was barely mentioned.

With the implications of Brexit sinking in, there are fears of a broader threat to Britain’s life sciences sector.

“Proximity does still matter, and the fact that the E.M.A. is here has made a difference,” Daniel Zeichner, a lawmaker for Britain’s opposition Labour Party, said. “This is a globally competitive industry, and we are really good at it, but it can go elsewhere.”

Mr. Zeichner, whose Cambridge constituency has a large life sciences sector, also fears that Brexit could increase the cost of drug authorizations and slow access to new medicines for Britons.

Some hope that the disruption can be avoided, and that the agency might remain where it is, with Britain continuing to participate. That seems plausible only if Britain seeks a very close relationship with the European Union, as Norway, Iceland and Liechtenstein did. But those countries agreed to be integrated into the single market, accepting free movement of people as well as goods, capital and services. Prime Minister Theresa May argues that Britons voted against such open borders, and is likely to resist that move.

Outside the bloc, Britain might opt to duplicate the agency’s work, but at a significant cost. Drug companies might require two authorizations for new products — one British, one European — pushing up the prices of medicine.

For the European Medicines Agency, Brexit creates scientific as well as logistical problems. It works closely with Britain’s domestic authority, the Medicines and Healthcare Products Regulatory Agency, and British experts take the lead in assessing about one-fifth of drug authorizations considered by the European counterpart.

If British experts withdraw after Brexit, burdens on other European nations will increase.

But for Mr. Rasi, his staff members and their families, uncertainty over the headquarters is the biggest issue, one that lies in the hands of the European Union’s heads of state and government.

In theory, they could make a decision speedily once Britain starts negotiations on Brexit, something it intends to do by the end of March. But history suggests that may not be easy. In all, there are 45 European Union agencies, or similar bodies, and they are considered trophies for member countries because they bring both prestige and economic benefits.

The European Medicines Agency, for example, has an annual budget of a little over $300 million and generates significant revenue. Most weekdays its experts fill 350 London hotel rooms.

When the European Food Safety Authority was up for grabs, Silvio Berlusconi, then the prime minister of Italy, blocked Finland’s bid to host it, saying, “The Finns don’t even know what prosciutto is.” The organization eventually went instead to Parma, Italy.

Mr. Rasi hopes for a quick decision and that any new location has good transport links and infrastructure. The competition promises to be fierce.

“That is the only nice side of the story,” he said. “It seems we are very popular. They all like us; they all want us.”

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